Rupee once again experienced a downward slide as it weakened against dollar and stood at 105.4/105.6 in the interbank market on Tuesday compared to Monday’s close of 105.3/105.5.
Nevertheless, this shouldn’t come as a surprise as the currency market has been fluctuating on a daily basis during the past few months. However, keeping in view the broader picture, the rupee never lost its ground despite experiencing extensive volatility.
Moreover, the State Bank of Pakistan has also imposed 100% cash margin on the import of some consumer goods in order to restrict the demand for US dollars. It is pertinent to note that rupee has been one of the best performing currencies in Asia for the past three years even after the sharp appreciation of dollar against other currencies.
However, the International Monetary Fund has said it multiple times that Pakistani rupee is overvalued 5-20%. Many analysts believe that the artificial support for the rupee has affected exports of the country adversely.